AFT 1043
BASIC ACCOUNTING
SEMESTER SEPTEMBER
2018/2019
GROUP ASSIGNMENT
NAME OF LECTURER: DR AINON
JAMILAH BINTI RAMLI
LECTURE GROUP: L1T3
GROUP MEMBERS MATRIC NO
LIM JING XUAN H18A0194
WOO WAI YEE H18A0671
CHIANG ZHI YING H18A0079
CHIONG WEN XIN H18A0083
Wan Muhammad Asyraf Bin Wan Mohd Zain A18A0941
Table of Content
Contents No of Pages
1. Abstract
2. Introduction
3. Background of the business study
4. Current business recording status
5. Action taken by the group to guide and help the business
to have/improve a systematic recording of business
transactions
6. Full set of accounts for one month
I. Improving the exsiting books/ accounts
II. Opening new book/account
III. Prepare the trail balance
IV. Prepare the trial statement of profit and loss
V. List down all assets and liabilities
7. The importance of accounting to the micro business/petty
trader’s activities
8. Suggestions to the micro business/petty traders of how and
what to do to have systematic recordings of business
transaction;and final accounts
9. Conclusion
10. Appendices
ACCOUNTS
Accounting is necessary for all size of businesses. The business need
accounting because it offers information that is happening in business. The vital
role of accounting is to provide the business owner the information about
business’s assets, financial position and the effect of operation. It is important
as it is offer quantitative information of financial to various stakeholders which
have desire in making economic decision. These stakeholders included
investors, management, government, suppliers and so on. The three major
business accounting system is income statement, balance sheet and cash flow
statement.
For running a business, every single transaction will be go through by
them. Accounting is important for a micro business or petty trader because it
show them clearly the profit and loss statement while the cash flows of the
business. Profit and loss make the business owner deeply comprehend their
results of operation. It help the company grasp the cash flows statement and
give the idea to set up the future revenue and expenditure based on it past
sales and expected income. The profit and loss table allows a business to see
where it can improve its revenue stream and cuts cost. By having this, it help
to avoid unnecessary financial loss.
It is not easy to get control all the data necessary to analyse the higher
level calculations necessary to financial plan for the future. Having an
accounting is the way to help a company to know about their financial health.
Balance sheet show the business owner that how much the asset they have,
how much the liabilities they owe and their business values. The accounting
data help a business to plan the budget and the prediction for future period.
Business tendency are projected based on past data generate by accounting
system.
Having an accounting make a business know the cash flow situation. It
help a business to make adjustment to keep running the business. Its show the
inflow and outflow of cash from any business activity. Cash is the primary of all
the financial operation. Therefore, having a cash flow statement make the
management to plan and control the financial operation properly. It also help
internal financial management because it is useful in formulation of financial
plans.
One of the function of the accounting is play the role for the stock
checking. Have an accounting company can manage their stock level. It can
guarantee the company have the actual quantities which available to meet
demand and make the flow of stock go smooth in order to avoid any affection
of cash flow. Improper use the stock will lead the loss of cost. It help company
fully recognize about the receiving or providing the stock and can handle easily
business deal. By effective of managing the stock take, it help company bond
the business relationship with suppliers and customers.
Last but not least, having an accounting is helpful for a business to carry
out the commercial activities smoothly and also helps in its future growth.
Meanwhile, financial statement produced by various accounting system are
used by multiple stakeholders to take economic decisious.
